Bernie Sanders’ Old Free College Try

Wall Street Journal:

Don’t forget that when Democrats nationalized student lending in 2010, they promised it would make money for the government. The Congressional Budget Office estimated $87 billion in savings over a decade. From the start this was fiction, and now Mr. Sanders is admitting it was off by a mere $1.5 trillion.

As for ending tuition, that won’t address the real troubles in higher education. Thanks to creeping credentialism, many jobs that once didn’t require a bachelor’s degree now do. College-funding mechanisms make little distinction between studying nuclear engineering and pursuing contemporary dance. Administration buildings teem with associate deputy deans for diversificlusion, and schools compete to have the most climbing walls per capita. The fix isn’t to promise taxpayer-funded diplomas for everybody.

Mr. Sanders said his plan would cost $2.2 trillion over 10 years and would be “fully paid for by a tax on Wall Street speculation.” A fact sheet from his office lays out a financial-transactions tax of 0.5% on stocks, 0.1% on bonds and 0.005% on derivatives. To exempt investors of modest means, he would create an offsetting tax credit for people with incomes under $50,000 or couples under $75,000.

There’s no way a financial-transactions tax would pay for this. It could make America’s capital markets less liquid or push traders overseas. By lowering asset values, it would dent every 401(k) and public pension, while raising costs for institutional investors. Mr. Sanders says it would raise $2.4 trillion over a decade, but France’s version failed to meet revenue targets.